INFORMATION TECHNOLOGY SECTOR IN THE EUROPEAN UNION: THE DIRECT ECONOMIC IMPACT

• Authors: Ludmila Sinica
• Languages of publication: EN

Abstracts

EN

Information technology (IT) sector is one of the most dynamic and innovative sectors with the highest growth potential, due to the constant automation of global manufacturing processes and growing popularity of e-commerce and e-services. The development of technologies is rapidly changing modern economic processes at the micro and macro levels, automating and upgrading all areas of national economies. Besides the direct benefits in forms of the sector contribution to gross domestic product, employment, investments and other economy indicators, the emergence and subsequent development of IT has a significant impact on the progress of all sectors of the economy. The overall development and use of IT is followed by significant costs reduction for the implementation of new technologies. The positive effect is achieved through synergy and multiplier effect of the use of IT in all spheres of economy and in everyday life. To analyze the overall impact of the IT sector on the economy, it was decided to carry out two studies about each effect separately. The first effect to research, which is more tangible and measurable, is the direct effect of IT sector on economy. Thereby the main purpose of the article is to analyze the direct effects of information technology on economy in a context of the sector development in the European Union. In the first part of the article, trends of the main economic impact factors of IT sector in the European Union were explored. Comparing the average growth rate of the main IT sector’s economic indicators with the average indicators across all sectors, an extremely rapid growth rates of IT sectorís indexes were discovered. To compare situation across all European Union countries a ranking method was used, that let to figure out leader countries in terms of different IT sector’s economic indicators in the region. Finally, a correlation method has helped to discover that IT sector indicators are not necessarily linked with each other and all 4 observed indicators are important and characterize the different aspects of the IT sector impact on the economy. In the second part of the article, an analysis of the main economic indicators of the IT sector was carried out to determine the direct impact of the sector on economy. The data analysis let to clarify the sectorís impact on innovations, employment and international trade balance of the European Union. The statistic data about the turnover, value added and personnel costs across different service sectors was examined, that led to conclusion that the information technology sector is an undisputed leader in terms of economic efficiency and is one of the highest-paying sectors in the region.

Keywords

EN

information technology; IT; information technology sector; role of IT; economic impact

• Publisher: Daugavpils University, Institute of Humanities and Social Sciences
• Journal: Sociālo Zinātņu Vēstnesis
• Year: 2017
• Issue: 1
• Pages: 59-75

Contributors

author

Ludmila Sinica

Identifiers

ISSN

1691-1881